U.S. PIRG Education Fund released its fourth annual study today, titled “Following the Money 2013,” evaluating each of the 50 states on their spending transparency with an “A” to “F” grade.

“State governments across the country have become more transparent about where public money goes, providing citizens with the information they need to hold elected officials and businesses that receive public funds accountable,” said Phineas Baxandall, senior analyst for tax and budget policy with the U.S. PIRG Education Fund. “But standards for transparency are continually rising, so there is always room for improvement.”

Among the report’s findings:

For the first time ever, all 50 states now provide some “checkbook-level” government expenditure information online, a major increase from three years ago when only 32 states detailed information on specific payments made to individual vendors. Thirty-nine state transparency websites now include reports about government spending through tax-code deductions, exemptions and credits – up from just eight states that did so three years ago. In the past year, a number of states created new transparency websites, including Arkansas, Connecticut, Idaho, Maine, Montana, Pennsylvania, Rhode Island, and Vermont. Seven states earned “A” grades: Texas, Massachusetts, Florida, Illinois, Kentucky, Michigan, and Oklahoma. These “leading” states provide detailed information on different types of payments, usually in searchable and easy-to-use databases. Five states earned “F” grades: Wyoming, Wisconsin, Hawaii, California, and North Dakota. These “failing” states provide some checkbook-level information, but their websites are limited in scope, lack comprehensiveness, and are difficult to navigate. Spending transparency follows no partisan pattern. On a 100-point scale, the average score of states with Democratic governors differed by less than half a point from states with Republican governors.

Since last year’s “Following the Money” report, there has been remarkable progress across the country, with new states providing online access to government spending information and several states pioneering new tools to further expand citizens’ access to this data. Officials from 48 states provided the researchers with feedback on their initial evaluation of state transparency websites.

“Open information about the public purse is crucial for democratic and effective government,” said Baxandall. “It is not possible to ensure that government spending decisions are fair and efficient unless information is publicly accessible.”

The states with the most transparent spending are comprehensive about the kinds of spending they include, disclosing data on economic development subsidies, grants, expenditures through the tax code, and quasi-public agencies—recognizing that these items affect budget trade-offs just as traditional spending does. But the best states have transparency tools that are highly searchable, include detailed usable information, and engage citizens—allowing all the information to be put to good use.

States that have created or improved their online transparency have typically done so with little upfront cost. Moreover, the report shows that top-flight transparency websites can save money for taxpayers, while restoring public confidence in government and preventing misspending and pay-to-play contracts.

“We’ve been encouraging states to advance spending transparency with our report cards since 2010. The progress that we’ve witnessed each year is very encouraging, and states should continue to prioritize transparency going forward,” said Baxandall. “As many states grapple with long-term budget shortfalls, it is more important than ever for citizens to be able to follow the money.”

Every year, state governments spend tens of billions of dollars through contracts with private entities for goods and services, subsidies to encourage economic development, grants, and other forms of spending. Accountability and public scrutiny are necessary to ensure that state funds are well spent.

In recent years, state governments across the country have created transparency websites that provide checkbook-level information on government spending – meaning that users can view the payments made to individual companies and details about the goods or services purchased. These websites allow residents and watchdog groups to ensure that taxpayers get their money’s worth from deals the state makes with companies.

In 2013, for the first time, all 50 states provide some checkbook-level information on state spending via the Internet. In 48 states – all except California and Vermont – this information is now searchable. Just four years ago, only 32 states provided checkbook-level information on state spending online, and only 29 states provided that information in searchable form.

This report, U.S. PIRG Education Fund’s fourth annual evaluation of state transparency websites, finds that states are closer than ever before to meeting the standards of “Transparency 2.0” – encompassing, one-stop, one-click checkbook transparency and account – ability. Over the past year, new states have opened the books on public spending and several states have pioneered new tools